tv Deputy U.S. Trade Representative on World Trade Organization CSPAN October 12, 2018 10:07am-11:21am EDT
de niro, he went out at the tony awards and delivered a f bomb about president trump. the response from the republican national committee is they put together a video of different celebrities saying outrageous things about president trump, and the collected it all together, and the whole title of the video was unhinged. that is the thing. you tend to see republicans attack democrats a lot more for their celebrity support, and i think that is driven by the fact that hollywood leans to the left, and republicans are looking for a, the way to brand democrats as out of touch and as part of the elite. >> welcome, everybody. glad you are here.
it is the first nice day we have had in a while. outside, orld be doing something else where it is a humid and the sun is shining, but here you are. . am happy you are here this is concept -- exceptionally good timing, those of you who wasow bloomberg know what quoted this morning about the articles administration's wto reform efforts and how the administration gets tougher reform with the issue of and taken more seriously. i think your presence here suggests it has been a topic of considerable interest in the united states. people want to know how it will play out. relatedly is directly to our trade relationship with china, and that will be a topic
of conversation this morning, i'm sure. good timing and good opportunity. for those of you that do not know the ambassador, let me say a little about him and then we will have a conversation for a while, and then we will turn it over to all of you for questions. andll give you a heads up we will stop because he has schedule issues around 11:15. you can plan accordingly. dennis shea is the deputy u.s. trade representative and our ofassador to the wto as march this year. he spent 11 years as a member of the u.s.-china commission,iew which i was privileged to work with him.
the commission has a policy of alternating between the two parties annually, so we spent a lot of time trying to -- as i put it earlier today, trying to keep insanity at bay, and i think we succeeded. certainly, i think it has made him an expert on china, national issuesy, on a lot of the that are right front and center on his portfolio at the wto. including adegrees, law degree from harvard, which i accord great respect, although my ambition in high school was to apply to harvard, be accepted, and turn them down, which i thought was infinitely cool. paid was too cheap to application fee because i knew
they would reject me or i would reject them. it is a considerable academic accomplishment. also his second time around for the federal government. he was secretary for policy development research at the department of housing and development, and prior, he said on the staff of then senator , so hey leader bob dole got a great executive experience, great congressional experience, and great china experience. job, now settling into the it would be a good time to ask them to come by and explain what he sees coming up. there are a lot of issues that have been put forward by this
administration and other documents that are out there that i think we will be talking about. the canadians have a paper that has been leaked, i assume we have all seen it. the eu put out a paper that they actually put out, did not have to leak it -- >> it was initially leaked. >> well, they did the obvious and made it public. thee are other things like -china trilateral document which has not been released yet. it, so you will have to tell me where to find it. >> in any event, there is a lot going on and i'm looking forward to talk with dennis about it. let us begin with easy questions and work our way through some of the issues. we will get to the appellate body but start with broader reform issues. words aboutus a few
your impression of the place, what is going on over there, how you have been received, the president has been publicly critical of the institution on a number of occasions. how have you been received by your counterparts? is there a lot of sympathy for the american position? spend a couple of minutes on what exactly are we trying to accomplish that? >> sure. thank you, for giving me this opportunity. it is great to see there is life after the china commission. you look like you are thriving, so good for you. i also see former china commission colleagues, hello. there was supposed to be a whole delegation here. , so it isat least two great to see you all. received very well by my counterparts at the wto. when i first got there, there was tremendous issue on who the administration was sending to
geneva, so maybe i benefited from that. i cannot say enough about how well i have been treated by others, and that was my attitude going in, to be friendly and deliver difficult messages that needed to be delivered. working good relationship with the director of the wto. i think the wto did itself a big as oney hiring alan wolf of its deputy director generals, a great resource for the wto and membership, so again, my impression of the wto of geneva, it is a beautiful city, the lake is gorgeous but it takes a long time for things to get done. a lotwas a lot of talk, of discussion, but frankly, not too much action so far. we are trying to get things moving along. the want to get to
appellate body issue, -- >> what is the appellate body? >> [laughter] let's just move on. one, whichet to that we all know we will get into the weeds here because that is what the wto does, with weeds, but let's start with the concept of wto reform more broadly. when i see you, i am referring to the administration, what are your priorities for change and what are the possibilities of alluding to what you just said? what are the possibilities of getting anything done before the next conference? how long do we have? this is the problem with wto reform. eu issuing a paper on wto reform, the canadians are
organizing a group of ministers in late october, but this discussion, in my view, the discussion of the beauty over form would not have happened but of the disruptive leadership the united states. what are our priorities? one priorities notifications, transparency. you need transparency to have a system, soing unfortunately, too many members are not transparent and failed to fulfill the notification obligations and i have statistics here i will not read, but the united states has tabled a notifications proposal that would pose some administrative measures on members who fail to live up to their notification obligation. that proposal has been joined in by the eu, which japan and the
u.s. are all working together to amend the proposal and put forward the proposal later in november. that is number one, notifications. >> what are they notifying? >> subsidies, domestic laws, and those sorts of things. but the record on notifications lawful.to is in point is i rose, the issue -- res, it wasi mentioned that too many countries at the wto self designate as developing countries, and as a developing country at the wto, you enjoy flexibilities and exemptions from the rolls. when you look at some of the amazing the air claiming to be developing countries at the wto. 10 of the g20 members claimed developing countries status at the wto.
china, the second-largest economy in the world and maybe the largest under ppp basis claims developing country status at the wto. five of the six countries with the largest gdp per capita claimed developing countries status at the wto, so bob lighthouses raised the issue at the ministerial conference in buenos aires last december and there is a real conversation going on at the dubya to you one whether this should be more differentiation among developing countries. that is number two. andissue of china's economy whether china is sitting the wto system, last july, the united states offered a paper on and theeconomic model point of the paper was the essentiallyel based
inconsistent with wto norms. i had a back and forth with my chinese counterpart. in fact, people said it was the most exciting time they have ever seen at the general council meeting at the wto. that is thewas, if most exciting, this place must be pretty boring. we really need to grapple with the nonmarket economy of china and the indications for the wto. we are moving forward and will talk about this process about the developing rules around industrial subsidies and forced technology transfer. that is another issue. let's say things were trying to advance at the derby to you, but i want people to understand leadership, -- without the u.s. speaking up, i do not think the reform effort at the wto would have been initiated at all. i think we still would have been sleepwalking at the wto, but with the united states pressing
these issues, people there have begun to realize there is a desperate need for reform. >> how faster things moving? is this all going to wait for the next ministerial conference or are you optimistic something might happen before then? maybe not on everything but some of the things. >> i think it would be incremental. i do not think there is a single undertaking approach to reform. the first thing off the bat out of the chute will be this notification proposal that the u.s. initially drafted and the eu and japan have no joined us on the redraft, so that will be the first thing out of the chute on the reform agenda. >> you mentioned the canadians. they put forward an effort of their own, and as you mentioned, there is a ministerial meeting there in two weeks in ottawa. what to think about their paper and its prospects? does it have any legs? >> first of all, their paper is not really a paper.
at the wto, there is a jargon called not paper. i never understood what it is. their paper has been leaked to a news outlet. there are some good things in the paper. it talks about the need for greater transparency and adherence notification obligations, discussion of differentiation among developing countries, the need to improve the committee work at the wto. there is also recognition that too many countries are trying to resolve trade disputes through litigation as opposed to negotiation. but i think the whole tenor of the paper is more trying to be a middle road kind of approach, and let's have more discussions, let's start discussions. i think we are beyond the point of having -- yes, dialogue is important, but we need to get actions in place. >> what intrigued me about it
was the group that is dissipating in the meeting goes beyond the usual suspects and countries in favor of doing responsible things. kenya, brazil there, mexico, a number of asian countries. that suggested to me this might have more initiatives that come from a single place. it is largely the friends of the system. the friends of the system are group of about 40 countries that believe in the system and wto. eu then they brought in the and japan, who are not friends with the system. china and the united states were not invited. i have told number of my friends or friends of the system that it is -- there is a middle road approach on some issues, particularly around china. it is no longer viable.
we need to recognize the economic system of china and how it isn't compatible with wto norms. if friends of the system care about it, they need to speak up about that. the fact the united states was not invited means -- briefed by my canadian counterparts who tell me what is going on, and we are not at all concerned about not being invited. theyve read the paper, and keep me posted on what is going on, and we'll see where it goes. >> your counterpart will be in town next week, so we will see what he says. >> which counterpart? >> their ambassador to the wto. >> ok. >> well, same question on the eu paper. question ora single country but a joint effort. you have made some public
statements. i think you have been the only one. what is your comments? >> well, there are positive points to the paper. again, i will repeat myself. greatere talks about adherence to notification obligations, more transparency. there is a section on counter notifications, where countries look at other country's subsidy approaches, other approaches and counter notified that to the membership. who is the only country that is counter notifications to the united states? india,one recently in one on china, so we support that. there is talk about greater differentiation among greater developing countries. we support that. reinvigorating committees, we support that. new approaches to negotiation that i called collateral as
opposed to multilateral. there are elements of the eu paper which are consistent with what bob lighthizer has been talking about and what we have been talking about her wto reform. the issue under the dispute settlement is where we had concerns about some proposals. if you want me to go there -- >> well, do a minute on that because i think it is important, the accountability. >> the accountability, what the eu paper proposes that the appellate body, which is the appeal's vehicle for once a panel makes a decision, a member who loses the decision can appeal to the appellate body. the eu wants to make the appellate body less accountable by giving them -- the appellate body secretary more resources, lengthening their term to six years to eight years, by making
them full-time jobs. this goes in the opposite direction of what the united states is calling for. the united states is calling for more accountability because the appellate body has strayed from the original standings of 1995, so that is the fundamental problem with the eu proposal on the appellate body. it provides less accountability of the propellant -- appellate body. there are other issues. it promotes a two-stage approach, where we deal with procedural issues around the appellate body first and then kickoff or two down the road these substantive issues. that is just not going to work. our concern about the appellate body is not just the trump administration concerns but bush administration, obama administration, and now trump administration concerns will knock it down the road substantive concerns for several more years. , anotherlate body
concern is the appellate body claims that its decision should be entitled were treated as precedent absence of cogent regions, and we do not support that view it all. but the eu paper is silent on that issue. the eu paper agrees with united states that domestic measures should be treated as matter of thes but tales to deal with general overall issue of the appellate body engaging in fact finding. again, the paper seems to -- rather than try to acquire the appellate body to adhere to the rules, it tries to accommodate what the appellate body is doing, so they propose to make about5, which we can talk that later, but make rule 15 part of the dispute settlement
understanding and that is accommodating with the appellate body is doing, which we disagree with. >> let's then turned to the appellate body a few minutes because that seems to be the topic that is front of the line these days. you have gotten into it. maybe you can elaborate a little bit. the u.s. concerns seem to be into categories, process, and for lack of a better term, overreach or over interpretation of the rules. you want to elaborate on the civic concerns we have? >> sure. for those of you who want to, you can go on the website and go to the trade policy agenda and look at pages 22 to pages 28. you can see our concerns outlined there. when i was at this meeting in 22 to 28 andtioned
people walked around saying pages 22 to 28, so i made the point. we have essentially six concerns . one, the appellate body issuing, adding rights and obligations to members that are outside what we agreed to in the various wto agreements. that is a major concern. the appellate body issuing advisory opinions on matters that are not for them, the appellate body engaging in a fact-finding, when it is the panel's job to do fact-finding and the appellate body to make sure they follow various agreements appropriately. the appellate body is supposed to decide, make its decisions within 90 days. the understanding says the appellate body should reach its decisions and 60 days but that no event should it exceed 90 days. if they have not -- the
appellate body is not issued an agreement in 90 days since 2014 and has a spotty record of complying with that will, even before 2014. the appellate body has a rule called rule 15, which says members of the appellate body can continue to work on appeals that they're working on and it is our view it is up to the membership to decide who sits on the appellate by, not the appellate body itself. it is another major issue. and the appellate body claims it's decision should be treated as precedent, absent cogent regions -- absent cogent reasons. we do not view the appellate court. an international while we do it as a mechanism, as a way to help members resolve their trade disputes.
those are the big issues. we have been pounding those issues, explaining those issues. engaging my colleagues on those issues. we have given lengthy statements in something called the dispute settlement body on each of these issues, and we will continue to do so and give lengthy statements on these issues. >> on some of the issues, like the rule 15 issue, the role of the members continuing after the expiration of their terms, if the dispute settlement body as a whole decided that was ok, would that be good enough? >> well, that is our major points, that it is up to the membership to decide. >> that would be the membership? the membership decided, since would be examined and talked about. >> you are also one of the members, if that were the issue, would you go along with that? if other members said they
wanted to review the details -- >> the devil was in the details. our fundamental point is that it is up to the membership to decide who sits on the appellate body, not the appellate body itself to usurp that authority and make decisions on who sits on the appellate body. >> where i was going with that big the second question. you may very well be able to persuade the appellate body to take back that authority and make the decisions, but that doesn't really comments on whether you would agree with the decisions they would make. >> you know if they may decide to permit rings we don't support. >> you have been asked that so far. >> you mean if -- i'm trying to understand your question. >> who gets to make the rules? the appellate body on its own, or the dfc? >> i think that is the point most people would agree that it
should be the members. >> but that doesn't address the question of supposing they want the things the appellate body has been doing that we don't like. >> it would have to be done by consensus and we would object. >> all right. where this is heading is the administration. i think it is a fair point that this predates the administration and goes back a long way, and the obama administration in particular took actions of reappointments for the body to reflect its unhappiness with some of the same issues. it is important to note that this is not a new thing. in fact, there were people in 1994 saying, this is what is going to happen. i do not think you are going to find a lot of people here who would say that the
administration's arguments are misplaced. like some other things in the administration, i think the argument here has been the diagnosis may be correct, but the description may not be. -- prescription may not be. the administration's tactic to object to filling the vacancies with both reappointments and new appointments, we are in a situation whereby the end of next year, there will only be two left. >> which would make it impossible for the appellate body to do its work. >> where's the offramp? how do we get to a resolution of the system or is the administration going to let it die and then let it see what happens then? >> again, our position is we want the appellate body to come back to what we negotiated, to return to what our understanding
was in 1995, so people ask, what does the u.s. want? what is negotiating demand? our proposal is the appellate body returns by the rules as we agree to a 1995, and they have gone astray. again, i am engaging my colleagues. they have a proposal to offer. we will examine and respond to it, but so far, there really isn't any proposal. you talk about the eu paper, that is a brussels paper. that has not been put forward in geneva. i understand they intend to take those ideas and put them forward and geneva, but our opposition is we already negotiated this, so the appellate body needs to return to what we negotiated. again. it takes to pot to tango. we will see it -- it takes two
to tango. we will see if the appellate body responds. this is an issue i heard a lot about at the wto but there have been no proposals offered in any significant way on the issues. that to me has been surprising. if it is that important, where are the ideas? >> i think the point of the article i alluded to in the probably is this is perhaps now being taken more seriously than before, so we will see, but you made the point in your marks that this is not an organization that moves at lightning speed. so let's suppose this may take a while, even assuming we can move in the direction that you want, so december 2019 arrives, we are still blocking reappointments, o.ey are down to tw we are a major bringer of cases and respondent in cases. the ones we bring we usually win
, and we have a slightly better record on the losing side, although the plaintiff generally wins. what are going to be the consequences for cases we care about if the appellate body ceases to function? what happens if we lose a major case in 2020 and have no place to go? will seeagain, we where this ends up. we have put forward at proposals and we are waiting for members to respond. there are other alternatives within the dsu. there is article 25, arbitration, as a possibility, but we want the appellate body to return to our negotiation. >> would we support article 25? >> potentially. have -- we do not have an
assigned seats, but there is a note on it now, who's term is not up for a good while. getting the chances of another american appointed or the sun reappointed? thisat is something -- or one reappointed? >> that is not something to think about. it is down the road. >> you put a bunch of things on the table or on the table in terms of the appellate body issues and what reforms talked about, notification sent differentiation issues -- and differentiation issues. do you see all of these things as having to move forward together or is the appellate body on a separate track and maybe we can fix the appellate body and not all these other things, or at least not at the same time or separately? or are we talking one big package that has to happen? >> i think everything is on a
separate track. i do not think there is a single undertaking. some members want to focus on the appellate body first, notifications, issues. for reform to take place, it will have to be an incremental process to start with notifications and see if we can do something on differentiation, but we will continue to engage on the appellate body issues of anyone who wants to engage and see where it goes. aires, ambassador lighthizer said it will be remembered as the moment the impasse of the wto was broken. many members realized the wto should pursue a fresh start in many areas so constituents are not held back by the few members that are not ready to add. is he right about that? has the impasse been broken? well, ambassador lighthizer
did a tremendous job pointing out what needed to be done at the wto and the remarks at bueno s aires. the conversation began, it is continuing, one thing we signed up at mc was e-commerce and digital trade. we were very much engaged in think bob got the conversation far enough when it started. >> i am glad you mentioned e-commerce. what is your prognosis on that? anthere really a chance for agreement on that? >> we have been very engaged in that. we have put forward a paper at the outset of the discussions around that plural lateral.
it seeks meaningful outcomes. we have probation -- we want to have prohibitions on disciplines around to ensure that this free flow of information and data across borders disciplines around countries requiring companies to give up the source ban on taxation or duties, and by the way, south africa and india went to rethink the moratorium on those duties, so we have a very -- the u.s. has been very engaged, and we have a high ambition approach to that. thereneral view is that will be negotiation parts of the process that may begin early next year, perhaps at the statement around all those -- around.
we were involved in the trade implementation agreement, with the triannual reviews, and we are probably the only country involved in accessions work of the wto, so we are very much engaged in the wto. i want people to understand that before they leave. >> i am glad you said that. based on my conversations with people there who are not part of the administration, they think the same thing, that american engagement continues at a high level below radar. you mentioned fish, and that is an important -- how optimistic are you that we will be able to get an agreement on fish subsidies? >> well, we are supposed to get the fish subsidies agreement done by december 2019, but the 20xt ministerial is june 20 so maybe we have a grace period.
it is incredibly important, not just for the world oceans but the viability of the institution. you cannot achieve the one to lateral outcome that ministers directed the wto to achieve by en thatt ministerial th does not bode well for the institution. this has important institutional implications for the wto to have an outcome with fish. the effort is being led by apata. -- roberto z >> there are a couple of other plural laterals that predate the administration and maybe you could comment on the administration's position and your prognosis for their future and that is the environmental goods agreements in the trade and services agreement. are they dead? >> i think they are under review in the building. >> they have been under review for 18 months. >> maybe you have not noticed,
but there is a lot going on in the trade area the past months. [laughter] toks are very busy, but they initiatives are still under review. >> do you think progress on either depend solely on the results of the u.s. review? why wouldn't other countries go forward and try to force the issue? is everybody waiting for us in geneva? byi get asked periodically my counterparts from the wto , but i hear view about that periodically. looking for some signal from united states. >> i guess i am curious because my recollection of where the ega --i would not say ended up but where it was last out with, there were issues between china
u more than us, but to see efforts to resolve those question mark >> i do not -- resolve those? >> i don't see that, no. maybe behind the scenes. i don't see it. i guess we will find out. it is good to see they are not dead. i would just encourage the to tell us all how they want to proceed. let's -- of thes turn to two bigger issues. one of the issues is that it has been floating around, not only because of the united states, but because of russia and the ukraine case, national security and the wto. both the united states and previously the russians have taken trade restriction action in the name of national security, arguing article 21.
are you concerned that those actions kind of opened pandora's box as far as the use of article 21? and we may be creating a precedent that while it might support the u.s. position, it is also encouraging essentially everyone else to do the same to the detriment of the system? >> it has always been practiced in many years that a policy of the united states that actions taken, trade relations -- trade actions taken out. -- taking are not just subject to the united states for review. i think what has been -- i think what practiced countries have exercised restraint in article 21 maybe because they are concerned about countermeasures imposed by the parties. that is what happened with the
u.s. we had some members pose counterterrorist -- counter-tariffs but i think the outcome for the wto -- if the pto through the dispute settlement system decided it was in the position to judge whether something was or was not in the national security interest of the united states or any other member. >> ok. otherthen talk about the elephant in the room, which is china. ambassador lighthouse or possibly his comments, i will to repeat i assume his comments unless you want to say something different. is the wto equipped to deal with china? and to deal with china's industrial policies? if not, how do we grapple with the problem? >> the wto is currently
constituted as not equipped. one of my jobs is to help educate the membership about the ramificationss of china's y, not just form the united states but the wto membership at large. that is why the u.s. submitted that paper and the chinese economic model at the last general council meeting in july. u.s.,s., china, the china, japan and the eu are engaged in a trilateral process. they are looking at ways to share information. they are looking at a number of areas, one on industrial subsidies, another on enterprises, forced technology transfer, and the third issue on defining what are the elements of a market economy? can we have a common understanding of what a market economy is?
involves theffort development of new roles. the u.s., the eu, and japan are engaged in discussions at a technical staff level about the development of new rules around industrial subsidies and facilities that bring us along and potential new rules about technology transfer. it is also information sharing and making sure that existing wto disciplines are properly enforced and maybe potentially improved. >> let's pursue that effort for a moment. i'm glad you commented on it. what is the game plan? eu, andsume the u.s., japan come to some sort of agreement on what they want to put the word in those -- put forward in those areas. what happens next? will you try to get other countries to join? will you approach the chinese? >> yes, once the last trilateral
statement says that they are going to try -- each of the trilateral members are trying to resolve their internal processes by the end of the year, and then reach out to other countries, other wto members, probably early next year. eventually, once there is a common agreement among the trilateral partners, then we will move out to approach other members. paperntioned the canadian . we talked about the canadian paper earlier in this discussion. there was a reference and that canadian paper to developing new rules around industrial subsidies and smes. i think there is an appetite in the wto membership for this approach. saw a report that the eu met with the chinese yesterday or the day before on these issues. do you have any news on that?
>> i googled that. >> [laughter] >> [laughter] i was wondering whether the issue a joint statement or communique, and i did not see anything, so i will have to talk to my colleagues back in geneva and see what came out of that. >> have we done that yet? talk to the chinese on these issues? >> when you say these issues -- >> 30 to your contacts? -- wto contacts? have been in the room when i laid out the problems we have with the economic system, so they are aware of what our views are. >> what -- tell us a little bit about -- bring us up-to-date on the status of the nonmarket economy case against the eu, and u.s. where is that? what timetable do you see?
what are the implications for the u.s., win or lose? >> the eu case is on a pastor case than the u.s. case, so there will probably be -- is on a faster track in the u.s. case, said there will probably be a decision. the eu and u.s. are cooperating, so probably by the end of the year or early next year. this is a very important decision for the dispute system at the wto. we feel that for nonmarket economies, we should be able to substitute market determined prices for cases, and just because china exceeded, we did not give up that right-wing china exceeded to the wto. rightwill see -- up that when china exceeded to the wto. so we will see. this will be an important decision. >> it is one where i think u.s. law constraints are free to
movement. onhink u.s. law is clear circumstances on which we could consider a market economy, and it is hard market if they meet those criteria. it requires an act of congress to change anything if we were to lose, which makes a catastrophic. ok, my last question before we open it is the only elephant in the room. is the president pulling this out of the wto? are you ready to come back home? look, the president was right to say that the wto needs to shape up. that is my job at the wto, delivering difficult messages, hopefully in a friendly way, and an open and transparent way. he was right. else thereerybody who pays attention to the wto agrees. the wto needs to shape up.
with negotiating, and needs to be reinvigorated. the dispute settlement system needs to be fixed. the monitoring function as an disarray, so he was right to say that. -- i brought my family to geneva, i am there to help them be constructive. the bags are not packed yet. >> no. let's go to the audience. we have some time, we have microphones. the rules are simple, please, identify yourself because we are al on camera, and second, ask question and not give a speech. we will start right there. the lights are in my eyes, so i cannot tell who it is. >> it is jake with the wall street journal and thank you for a great panel. i wanted to make sure i fully understood your answer to bill's question on the appellate body is twofold.
one, in your view, the u.s. would not clear any additional appointments unless a clear reform package to be with liking was adopted? and second, that you do not consider the rolling off of the next member in the appellate body ted two members as a hard deadline and it reforms to your liking are not passed by then, so be it? is that a quick interpretation of what you were saying? >> i am having trouble with the echo, hearing you on the microphone, but yes, i will be clear, the u.s. position in the appellate body has strayed in the six areas that i mentioned. from what the original understanding, the original barking of 1994-1995, and our position is the appellate body needs to return to that original understanding. that is our position. >> [indiscernible] well, we do not make decisions in advance about -- we
made a decision about the last appellate body member, who is seeking reappointment. we made that decision over a period of time, so i would not say hard and fast. we are not going to support other future appointments to the appellate body. we take it up as that issue arises. so i am not saying hard and fast. >> here in the second row, third row, whatever it is. greg. you talked about resistance to change, and the two places that one of the things the eu is puzzling because it seems to be in their interest to agree to the reforms we are pushing. in are they slow walking it your view, if you were willing to talk about motives? the other issue is china, you made a powerful statement referring to alice in wonderland and talking about the chinese negotiating position on the wto
and what the are arguing in the context. it was a powerful statement and i was hoping you could share with the audience the reason you made the analogy. >> well, thank you, greg. in may general council meeting, it was my first general council meeting. china put the u.s. on the .genda, which was unusual on 232, on 301, on the appellate body. it was clear they were trying to position themselves as the defender of the international trading system. to me, that was ludicrous. that is why i made a statement. i have got many remarks from people who were at geneva,
thanking me for making that statement, and saying it was on point. then we used the following general counsel meeting in july to put china on the agenda and highlight how the economic model is incompatible with wto norms. i think it is available publicly, but i urge you to read at. it is very straightforward, eight pages, and it ends in a very -- if china does not change its course, the implications for this organization are decidedly negative. for me, trying to deal with nonmarket economy of china is the most important for me, the most important issue of wto reform. and probably the toughest. >> ok. >> thank you. evan for the court of appeals
for the federal circuit. >> hi. >> i would like you to comment on whether a member state can emerge from status if it does not have independent court system? >> that's a great question. that's an issue that does not get as much attention in this discussion of the economic model of china that it deserves. in fact, in the paper that i am talking about, that we submitted in july, we have a paragraph on the fact that there is no independent judiciary in china that can solve disputes among stakeholders in china in an impartial manner. so it's under communist party control, the
judiciary, in china. so i think that's a great point. in a point we made geneva at the w.t.o. general counsel. i am not sure, i am wondering, i would have to double check. in may, the three trilateral partners issued a statement. this is what we consider are the elements of a market economy. i have to check to see whether the independent judiciary is part of that list of elements. but it's a very good point that you raise. >> jim, you had a question? >> thank you, washington trade daily. you start your comments saying that the w.t.o. is hard to move. doing away with the consensus rule help? >> it's hard to get 164 people, members, to agree to anything these days. imagine that, to get 164 -- that's the consensus rule.
everybody has to agree. i think the alternative has been followed, to use these plural initiatives where like minded parties can come together in an open and transparent manner. if you don't want to join now, you can participate and observe. if you want to join later, then you can join. i think that's the way to go, going forward. the u.s. supports this process. it's something we agree with e.u. on as part of the e.u. reform paper. canadian paper also talks about it. i think that's the way to move forward. but there is resistance to it. for example, south africa and india, i believe, don't want w.t.o. secretary resources to be used to support these plurilaterals. so it's a tough nut to
crack. but you've identified an issue. > here on the right. >> international trade today. the implementation of the trade facilitation, could you tell us what is outstanding, what is behind schedule, and what is going well on that? >> i need an expert to help me on that one. i just know that the u.s. -- i have a staff member of my team, david, who works the trade facilitation agreement. he is a tremendous asset, and he is working that to make sure the t.f.a. is implemented properly and we are submitting best practices to help other members understand how we do things and maybe suggest that's an approach they should take for their own customs regimes. in terms of specific deadlines, i don't -- i
can't get that. i have to call david. >> right here. >> independent consultant. i remember a few years ago, probably right in this room, from the audience, someone identified themselves as a member of the u.s.-china economic review commission and made an impassioned statement about the trade imbalance and so forth and so on. basically, the response from that panel at the time was, thank you for your service. next question. so coming from that background, do you feel now with the position of the current administration that long overdue issues are on the table, which you probably saw years ago? >> yes. >> is that you? >> no, i have a guess. thank you for that comment
and question. i had an opportunity to meet with the former governor of the people's bank of china, and i was introduced as a former member of the u.s.-china economic security review commission. i told him that i joined this commission in 2007. when i joined, we were viewed as outliers on the political spectrum, maybe too harsh on china, too negative. i told them that the whole attitude in washington across the political spectrum has shifted to where now the u.s.-china commission is in the middle, right in the mainstream of opinion, at least diagnosing the problem. so i communicated that message. i think the commission was a great opportunity for me, great learning experience for me being a member. it was great to work with bill.
so it is somewhat satisfying to see that the commission has gotten much more attention today than it had in the past. >> fred. >> fred bergsten. thank you for being here. back to china, which you rightly say is really the central question for w.t.o. reform and much else in the global trading system. suppose you can get agreement, with your trilateral compatriots and a fair number of other parties, to recognize that there are real problems with chinese trade practices. suppose you can get together a pretty respectable, multilateral consensus, not everybody, consensus on significant reforms and you come up with specific proposals of the type you were discussing maybe by early next year. how will the chinese react
if they face a fairly widespread international agreement that there are problems and that that problem threatens the viability of the system on which they depend so heavily, how do you think they'll react? >> i don't know. i know they are reacting initially saying, you throw down industrial subsidies, i am going to throw down export restraints and investment restrictions. that's their reaction. you want this, we want that. so, so it's -- that's the reaction i've heard in geneva. i think it's very important -- i've been trying to communicate. i maybe mentioned this is going on for so long, i forget what i said before, that it's really important that we get the friends of the system and other members to pipe in on this. they want to be middle of the roaders when in fact they really need to pick a
lane. i think it would be really helpful if some of these smaller countries or friends of the system, middle road countries, at least took the position of speaking up and supporting what we are trying to achieve and calling out the problem. that would be very helpful. >> ok, right here on the aisle. >> hi, thank you. bloomberg news. just to follow up on this, you just said what you expect china to do in response. so why is this administration so focused on trying to craft new rules to remedy unfair chinese practices if you think that the chinese don't follow rules anyway or this administration is skeptical that the chinese will follow any rules, and then you said it would be catastrophic if it goes the wrong way. so, so what do you think and if the u.s. loses -- >> i agree.
>> should china be kicked out of the w.t.o. if the u.s. loses? >> you know, yes, the first question -- we are committed to the trilateral process. we are working -- hopefully we will develop a common understanding of what new rules would look like with the e.u. in japan and then branch out from there. yes, we are probably a little more skeptical about the viability of rules to actually significantly modify chinese behavior. but that does not mean we should not pursue this approach which we are pursuing. for example, the 301 action, we took -- it has four components. we took one component to use the rules, the w.t.o. rules, and i brought a case to the
w.t.o. dispute settlement system on the licensing issue, licensing regime in china. but the other areas which we identified, cyberespionage, strategic investment, other issues we felt were not appropriately covered by w.t.o. disciplines and therefore that's why we went he tariff route. well, it's still in the very early stages. the e.u. has also filed another -- very similar case. and japan may or may not file a similar case. but it's in the early stages of the licensing case. >> ok. >> no. >> nice try. >> brett with inside u.s.
trade. back to the appellate body for a moment. >> hard to hear you. >> sorry. on the appellate body, do you believe there will be a resolution to this before the body get down to two members and how dire of a situation does the administration see that in your opinion? would it be a big deal if the appellate body went down to two and could no longer perform its functions? >> i guess, you know, it's not up to the united states. the united states has put forward its position. its positions are really clear. we have been making these points for not just 15 months but for 15 years. and our proposal is that the appellate body needs to abide by the agreement from 1994. it says the appellate body
shall issue its decisions no later than 90 days and they haven't done that since mid 2014. so what the solution is, the appellate body needs to abide by the rules. so we will see where it goes. it's obviously gotten a lot of folks' attention in geneva. i will be talking with my colleagues regularly about these issues and maybe we will see some proposals put forward. >> we have time for maybe one more. right here in the front row, familiar face. >> thank you, don phillips, american sugar lines. u.s. and other developed countries have tried to take on this differentiation issue before, usually at the start. but they've always given up because the develop country world has been united or seems to have been united in rejecting it. do you get the sense that that's changed, in particular the poorer developing countries, you
think willing to stop standing behind china, india and the big emerging economies? >> i think there are some developing countries that are -- agree with what we are saying. kenya, i think, has been outspoken on this issue. what recently happened is the chinese taipei, the w.t.o. parlance for taiwan, at their latest trade policy review said we are no longer going to seek special treatment as a developing country in future negotiations. we are going to be treated as a developed country. that is the type of thing we hope to see more of, countries with advanced ches saying we will step up and assume all the obligations of a developed country. we hope to see more of that. >> ok. we have reached the appointed time. all i can say is thank you very much. >> sure. >> i think it was
watch that live today here on c-span. new mexico has a three-way ace for u.s. senate. former new mexico governor is running as a libertarian. that debate tonight at 9:00 eastern. you can watch that live. we will have live coverage of a couple of debates this weekend. saturday wisconsin senator tammy baldwin debates her challenger. on sunday sherrod brown debates his republican challenger, in cleveland. live coverage of that starting at 6:00 p.m. eastern on c-span, online and on the free c-span radio app. c-span is your primary source for campaign 2018. >> saturday, thee retiring members of congress, democratic congressman joe crowley of new york, democratic congressman gene
green of texas and republican senator jeff flake of arizona all discuss their experiences in congress. >> my greatest achievement and our greatest achievement as a country was the passage of the affordable care act. worked very closely with the obama administration whipping that bill to the floor and getting the votes we needed to pass it. it's one of the greatest accomplishments of my career here in washington. i think it was for people who have no insurance who today have it. >> i have a district that has probably huge numbers of immigrants. so some of the things the president has done is against what i think our country ought to be doing. people ought to -- the dreamer act. these are people who were brought here when they were children. you can't commit an offense when you are a baby or a child. we should be more inclusive. america is an immigrant country.
>> it's a tough time to be here. i never did warm to the president in the campaign or as he governed. these days you not only have to embrace the president, you have to embrace all of his politics and his behavior in order to get through the republican primary. that was never in the cards for me. i just couldn't do it. >> join us for conversations with retiring members of congress saturday starting at 9:00 eastern on c-span and c-span.org or listen with the free c-span radio app. >> video from a local tv station covering the florida panhandle. officials now attribute at least 11 deaths to hurricane michael and say the category 4 storm was the most powerful hurricane to hit the continental u.s. in over 50 years. fema provided an update this morning.